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World trade growth is down sharply in 2013, a trend reflected in the U.S. and Chinese trade in manufactures during the third quarter of 2013, according to an analysis from the Manufacturers Alliance for Productivity and Innovation.
In the report, Ernest Preeg, Ph.D., MAPI senior advisor for international trade and finance, notes that U.S. exports grew by 2 percent in the third quarter after having advanced 1 percent from January to September. The U.S. trade deficit was relatively flat in the first two quarters but grew by 6 percent in the third quarter.
Chinese trade was uneven. Exports soared by 19 percent in the first quarter, by 3 percent in the second quarter, and by 4 percent in the third quarter. A huge increase of 28 percent in the trade surplus in the first quarter was followed by a 5 percent decline in the second quarter and a leveling off in the third quarter.
“These uneven changes in export growth and trade imbalances indicate an unclear path ahead, which will be driven largely by the export-led growth strategies of U.S. trading partners, particularly in Asia,” Preeg said.
Increasing trade imbalances from 2009 to 2012 have eased greatly in 2013. For instance, from 2009 to 2012, Chinese exports of manufactures rose by 71 percent to $1.9 trillion, almost double the U.S. growth of 38 percent to $1.1 trillion. The Chinese surplus surged by 92 percent to $866 billion, while the U.S. deficit rose by 61 percent to $516 billion during that time frame.
Conversely, based on the January to September 2013 figures, Preeg estimates the Chinese surplus will increase by about $40 billion in 2013 compared with $127 billion in 2012, and the U.S. deficit will rise by about $10 billion in 2013 compared with $41 billion in 2012.
“The big question is whether this sharp decline in the trade imbalances will continue in 2014 and beyond, and there is no definitive answer,” Preeg said. “The U.S. share of global exports of manufactures declined sharply from 19 percent in 2000 to 12 percent in 2012, and will decline further in 2013. The EU share went from 22 percent to 19 percent while the Chinese share soared from 7 percent in 2000 to 22 percent in 2012."